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Defined Contribution

In a defined contribution or "DC" plan, the amount of the contribution is defined by the plan. In other words, you "know" how much goes into the plan (or at least the formula for determining it), not the benefits that may eventually be paid out.  A defined contribution plan has individual accounts for each participant in the plan, and it can include both employer and employee contributions.  The most common DC plan is the 401(k) plan, but it may also include 403(b) and 457 plans, as well as profit-sharing and employee stock ownership plans (ESOPs). 

These contributions are invested at the direction of the employer (as in most profit-sharing plans), the employee (as in 401(k) plans), or according to the plan itself (employee stock ownership plans, or ESOPs).  The employee benefits directly from any investment gains in his or her individual account—or suffers from any investment loss.  There is no "insurance" for these benefits, as there is with defined benefit plans.

 


May 08, 2013
IRAs, DC Plans Top Retirement Savings Vehicles

IRAs, DC Plans Top Retirement Savings Vehicles May 8, 2013 (PLANSPONSOR.com) – Assets in employer-sponsored retirement plans, IRAs, and annuities totaled $19.5 trillion at year-end 2012, up 8.6% from year-end 2011. Rebecca Moore editors@plansponsor.com According to the Investment Company Ins
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May 07, 2013
DOL Seeks Comments About Lifetime Income Data

DOL Seeks Comments About Lifetime Income Data May 7, 2013 (PLANSPONSOR.com) – The U.S. Department of Labor (DOL) is seeking comments about rules for lifetime income illustrations provided to defined contribution (DC) plan participants. Kevin McGuinness editors@plansponsor.com An advance notice
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April 30, 2013
Institute Raises Budget Concerns to Legislators

Institute Raises Budget Concerns to Legislators April 30, 2013 (PLANSPONSOR.com) – The SPARK Institute submitted a letter to legislators raising concerns about proposed 2014 budget provisions that could impact retirement savings. Kevin McGuinness editors@plansponsor.com The statement, submitted
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April 30, 2013
Mercer Launches Retirement Education Website

Mercer Launches Retirement Education Website April 30, 2013 (PLANSPONSOR.com) – Mercer has launched an online retirement planning and education program for 401(k) plan participants to better prepare them for their financial future. Kevin McGuinness editors@plansponsor.com The website, “Uncover
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Interview with Gables Residential

Charlie Ruffel speaks with Philip Altschuler, 2013 Corporate 401(k) <$50MM Plan Sponsor of the Year finalist. 

Interview with Baystate Health

Charlie Ruffel speaks with Mary Dunn, 2013 DB Plan Sponsor of the Year winner. 

Sponsored Resource Center

Insights from and interviews with industry experts. View all of our current sponsored roundtables here. 

Outside the Box

For years, the traditional “style box” has been the answer to educating participants about diversification and investment philosophy within defined contribution.  

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